U.S. crude oil inventories may finally be below the five-year average for this time of year, but U.S. jet fuel inventories are still sky-high-a nagging reminder that the pandemic's impact is a long-lasting one.
According to the EIA's latest inventory data for kerosene-type jet fuel, stocks are continuing to rise-and that's worrisome for the oil industry because summer air travel typically drains those stocks.
For the week ending July 16, there were 44.974 million barrels of kerosene-type jet fuel sitting in U.S. stocks.
Jet-fuel demand is a significant component of overall oil demand, as the fourth-most used petroleum product in the United States. Jet fuel consumption averaged about 1.08 million bpd in 2020, or 6% of petroleum consumption, according to the EIA.
According to the Transportation Security Administration, cited by Bloomberg, air traffic in the United States is rebounding, but it is still only 78% of what it was during the summer of 2019.
At this rate, the current high stocks won't drain overnight-especially when supply chain issues are causing outages all over the West Coast, further denting demand.
A potential fuel shortage in Reno-Tahoe International Airport is threatening air travel there. The airport is citing high demand for air travel, available space in the fuel pipeline, and a shortage of fuel truck drivers as the reason for the shortage.
Bozeman Yellowstone International Airport is also causing flight delays and departure problems. Officials there cite an increased demand from firefighting aircraft as well as supply chain issues.
And there's more.
Jet fuel shortages in Oregon and Utah could cause firefighting aircraft to be waved off from multiple airports as the wildfire season in the U.S. West rages on, and Arizona started reporting jet fuel supply issues in June.
Most analysts agree that jet fuel demand will not return to pre-pandemic levels this year.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More